Beginning Workers			15
Beginning inventory =			50
Productive hours/worker/day =			7
Units per worker per month			40
Paid hours/worker/day =			8
Working days in month			20

Materials =	$1,800
Holding costs =	$550
Marginal cost of backorder =	$800
Hiring and training cost =	$500
Layoff costs =	$800
Straight time labor cost/hr.	$30

Chase Strategy	Jan	Feb	Mar	Apr	May	June
Demand	575	715	675	985	1,125	575
Beginning Inv.	50	35	0	5	20	15
Net Requirements	525	680	675	980	1,105	560
Beginning Workers	15	14	17	17	25	28
Hired	0	3	0	8	3	0
Fired	1	0	0	0	0	14
Req. Workers	14	17	17	25	28	14
Production	560	680	680	1,000	1,120	560
Ending Inventory	35	0	5	20	15	0
Material Cost
Backorder Cost
Labor Cost

What is the total backorder cost?

Group of answer choices

1. Less than 0

2. Equal to 0

3. Greater than 0